LONG BEACH USED TO BE THE "AFFORDABLE" ALTERNATIVE TO OC AND LA, BUT AN INFORMATIONAL AND PSYCHOLOGICAL BARRIER IS PREVENTING LB FROM ACKNOWLEDGING THE SEVERITY OF THE ENSUING HOUSING CRASH, AS LONG BEACH REAL ESTATE PRICES NOW SURPASS THE OC IN MANY CASES. I CHALLENGE THE CONVENTIONAL WISDOM OF COMMISSION-HEADS WHO CLAIM "NOW IS A GREAT TIME TO BUY," AND I WANT TO HELP BUYERS ENSURE THEIR LARGEST SINGLE INVESTMENT IS A SOUND ONE.

Wednesday, December 30, 2009

Address: 37 58TH Pl, 90803
Asking Price: $1,049,000
Beds: 3
Baths: 3.5
Sq. Ft.: 2,305
$/Sq. Ft.: $455
Lot Size: 2,396 Sq. Ft.
Year Built: 1923
MLS#: P693252
On Redfin: 177 days
Down Payment: $210,000
Income Requirement: $262,000
Monthly Nut: $6,700
Description: Check out this fantastic ocean and bay view peninsula home PLUS INCOME! Front house is a two story two bedroom two bathroom home. The entire second level is master bedroom with a giant ocean and bayview patio and enormous bath with a sauna! Rear building has a one bedroom and studio unit. Rents coming in at $2050/month. That offsets over $380,000 of mortgage at 5%!

It seems potential buyers have been checking out this "fantastic ocean and bay view peninsula home" for quite some time now. And yet a sale eludes this guy.

With photos like these, I simply can't figure out why. Check out this kitchen:

Magnificent!

I have to admit this view from that "giant" patio is incredibly impiressive:

The master bath ("with a sauna!") is also something to behold:

Absolutely stunning!

Or this shot of the two rental properties in back:

WOW!

The exterior may look like Ted Kaczynski's cabin fell over, but the gorgeous interior speaks for itself!

But, hey, cut this listing agent some slack--ever since the real estate market bottomed in 20072008 2009, he's been insanely busy. Selling as many houses as he does, as quickly as he does, means 177 days isn't nearly enough time to provide some photos.

Especially when you're only asking $1,049,000. I mean, a million bucks is small potatoes for a baller realtor like this.

And speaking of a million bucks, according to this incredibly savvy listing agent if you buy this property it will actually only cost you $669,000. You see, according to the listing description, "Rents coming in at $2050/month...offsets over $380,000 of mortgage at 5%!"

Well that's an interesting way to look at things! I guess banging hookers for the rest of your life instead of getting married offsets wedding costs, but I digress.

So, all you have to do is run a veritable boarding house and the price is magically slashed by $36%! [Of course, they might as well have calculated the offset "savings" at -111.1% because there's no way in holy hell you'll find a 5% jumbo loan today. The FHA's not even drunk enough to touch that one.]

With a bargain like that, I'm shocked there has been no interest in this gem!

I mean, come on! The asking price has been slashed aggressively--down a whole 11% in six months. What a steal!

Interestingly, the 2003 owner was unable to capitalize on the rampant, batshit insane housing bubble run-up. A year after purchasing for $925,000, he tried to sell it. So far, so good--paint-by-numbers bubble flipping. But after 16 months on the market (remember, this is near the apex of The Great Housing Bubble! Studios with murphy beds never spent more than a week on the MLS) he sold to today's current seller for $935,000--a meager $10,000 profit. Not enough to cover even a fifth of sales commissions).

This place must be a real shithole.

The current seller, ironically, has fallen into the same trap as the previous one: He overpaid for an undesireable property, in an undesireable configuration (who the fuck wants to spend all that dough to be landlord to a bunch of other people while you live in a tiny-ass 2-bedroom?) in a very desireable area. No big deal...unless you have plans to sell for a profit someday.

Plus, I'm assuming since today's seller and agent are too ashamed to include any photos it's still a steaming dump inside, making a sale even more difficult.

Hell, even crazy-ass Epraisal and Cyberhomes refuse to buy into this "million-dollar-home" horseshit:

LOL! It's obvious (to everyone but the seller) that he's in a race against time and cruel, frigid reality. The previous seller was lucky to get away with only a small loss after his colossal investment mistake, and I hope this guy is as fortunate.

Maybe 2009 will be remembered as the year we put the worst behind us economically, and '10 will be the year of recovery and a return to 10x income housing prices. Then, I imagine, it truly will be a happy new year for this seller.

Monday, December 28, 2009

215 South THE TOLEDO, 90803
Approved Short Sale Price: $1,450,000
Beds: 4
Baths: 4.25
Sq. Ft.: 3,345
$/Sq. Ft.: $433
Lot Size: 3,390 Sq. Ft.
Year Built: 2008
MLS#: P616675
Down Payment: $290,000 (assuming a bank would let you get away with "only" 20%)
Income Requirement: $363,000
Monthly Nut: $8,800
On Redfin: 718 days
Description: Short sale approved at list price. Can close qickly. Brand New Custom Home. This New Home has Big Walkin Closets In every bedroom on the second floor! Downstairs bedroom and bath can also be a maids Bedroom or office. Double door Formal entryway that leads into a huge Kitchen with upgrades and a great room with its own half Bathroom. Oversized Attached Garage. Curved Stairway that Leads you to Laundry room and second floor with Master bedroom that has two walkin closets, Fireplace, Master bathroom and private balcony. Second Floor hall way leads to two more Bedrooms, each with walkin closets and private baths. Private Door leads to the third story deck that has water, electricity for all your entertainment needs. Advanced Electrical for Entertainment systems, speakers, Lighting, Vacuum System, Security, Internet, Dual Air . Plenty of Storage through-out Home. Too many upgrades to list all.

"Qickly"?

"Walkin" closets? Where they walkin' to?

And Nice (Ab)use of Title Case, Dickhead.

It's been a rough few years for this fliptard. His simple plan was to tear down the old property, build a McMansion in its place, and flip it for a sizeable profit.

Unfortunately, his timing was absolutely horrendous.

You see, he paid $950,000 in January 2007, juuuuuuust past the peak of the housing bubble. The year he spent constructing this 3,345 square foot behemoth (on a freaking 3,390 square foot lot! What?!) saw the beginnings of one of the worst economic catastrophes in world history.

As quickly as he could, and before the economy got any worse, he put it on the market. Unfortunately, 2008 was the year of the credit crisis. His initial asking price of $2,700,000 might have seemed high even during the height of the bubble, but in the context of a full-blown economic disaster 2.7 mil was laughed off dismissively by market participants. And it's been a race against the clock ever since:

You have to appreciate his complete ignorance to market realities during the ensuing 718 days. Specifically, the 14 months between August 2008 and October 2009 that saw no price reductions. Smart! You're really good at this!

Given that insane amount of time spent being totally uncompetitive, I have a feeling 1.9 mil was the breaking point at which a short sale could be avoided. And it's been a sad race to the bottom ever since.

Honestly, I think the approved price of $1,450,000 is about right. This is BRAND NEW construction and has never been lived in. The upgrades look great and the Naples location is fantastic (although it appears to be right next to a massive apartment complex). Plus, most people buying these properties don't really expect to have a yard anyway.

Given all of that, along with a quick glance at the listed and sold comps (typical for Naples is between $541 and $671 per square foot), $443 per square for a brand spanking new build actually seems like a good deal.

So what gives?

Who knows. Fear of further drops in the high-end? Jumbo financing snags? Pain in the ass short sale process? Fear Of Unnecessary Title Case?

Or maybe Santa brought someone escrow paperwork for Christmas and it will go pending within days.

Regardless, I can't believe the "owner" has stuck around this long to find out. After three years of carrying costs on that $950,000 purchase loan plus AT LEAST $500,000 in construction loans, I figured he would have tapped out by now and moonwalked away.

Hey, shithead, it's called "Signal Hill," not "SIGNAL HILLS." Welcome to Long Beach, dickhead. Spend some time...maybe you'll learn a little bit about the city. And spelling. And proper use of the CAPS key.

"PERFECT HOME IN A PERFECT LOCATION"? This is only true if you're a big fan of handgun fire and home invasion robberies.

This 1987 Camry (oh, you're selling a house? Your only photo doesn't really make that clear) has been festering on the market for FIVE FUCKING YEARS and that's "MOTIVATED"?

A "motivated" seller would have sold by now. This is just a retarded seller.

Furthermore, the listing includes some seriously misleading information. No, not about square footage or the number of bathrooms, but this:

Status: Active This listing is for sale and the sellers are accepting offers.

HAHAHAHAHAHAHAHAHAHA.

It most assuredly is not for sale. And as far as "accepting offers," in the listing description we're treated to the wayworn, passive aggressive language of clinically delusional:

"PLEASE BRING ALL REASONABLE OFFERS."Ah, I see. Translation: We're only accepting offers that provide us with our much-deserved bubble riches. Our enrichment, not the realities of the market, is what's important here and unless you're willing to coddle our ridiculous, petulant demands, don't even bother. We're above it and you're a sociopathic vulture if you dare try to convince us that the housing bubble panty party is over (which it's not, you dick), your offer will be arrogantly, and flippantly, denied.

I have a personal, deep-from-the-bottom-fo-my-heart message to this dude:

FUCK YOU, DIE BY DROWNING.

Just take this dump off the market and go back to your life. Why insist on wasting everyone's time? Are you slow? The price, the fact that you couldn't even manage to post one decent picture, your "reasonable" offer shot across the bow to your potential buyers, and the ONE FUCKING PRICE REDUCTION IN ALL OF 2009 make it abundantly clear that you have absolutely no interest in actually selling.

You're only interested in unjustifiably enriching yourself.

Considering you paid $270,000 in 2004, you have years of appreciation/equity wiggle room--so why swing for the fences with an asking price nudging up against a half-a-million bucks?

It certainly can't be the comps. Because the most expensive property to sell in this questionable 'hood during the last six months was for $375,000 and that house has an extra 100 square feet, a bonus bedroom, minor upgrades, and two more bathrooms.

You, on the other hand, don't have any of those things yet are demanding $364 per square foot. FYI, the going ppsft in this area is about $265.

You should be ashamed of yourself.

But, if you had any sense of shame I guess you would have sold long ago.

Tuesday, December 22, 2009

So let me get this straight. You've been molting on the MLS since May 2008 and now you come to the brilliant realization that what your listing really needed all along was a price increase?

Just how many purple paint chips have you been eating, sir?

The property is now listed as a short sale, but does anybody really think the bank will sign off on a massive $300,000 loss?

It's a moot point because even if the lender does agree, the market has made it abundantly clear that any price above $500,000 for this dump is like buyer kryptonite.

Worse yet, the property has apparently fallen into disrepair and now has even less of a shot of selling. Instead of wasting his time waiting for a miracle, this seller needs to accept that no buyer will magically appear to rescue him with $526,000.

You fucked up and overpaid--accept it and move on. There is no happy ending here.

+++++++++++++++++++++++++++++++++++++++

Today's property just got hit with The Scarlet Number: 90.

As in, 90+ days on the market.

And a closer look reveals why it has languished so long, and why it is doomed to remain on the MLS for much, much longer.

The listing description tells you all you need to know about this property's chances of selling. I mean, that has to be one of the most pathetic, piss-poor descriptions I've ever featured.

Let's start with the Triple L claim. Yep, it's in a decent neighborhood. One of the Three Ls down! But it's also sitting right on top of a very busy 4th Street. And there's a stop sign smack dab in front of the property. Traffic noise, much?

Furthermore, whenever I've walked, ridden or driven by this place, I'm astounded at the lack of privacy. There is vast exposure to the street at practically every angle.

Technically the location, as it relates to neighborhood, is good, but otherwise this is an unbelievably unappealing location. For instance, at night the lot 40 feet behind the house is used as the main parking area for the Silver Fox bar/club (it's a Smog Check place by day). Add to that the incredibly low picket fence, and you've got yourself zero privacy.

Next, the realtor can't even get the name of this "Desirable" neighborhood right. "Belmon Heights"? Is that the Jamaican area of Long Beach or something?

At least the "residential with commercial used" line tells us something useful. But then we're hit with, "formaly the 'SANCTUARY'."

Do you mean, "Formerly"?

And exactly who gives a damn what this place was "formaly" called? What possible relevance would that have to anyone? Whatever it was called, it's defunct. Plus, why waste space in the listing description when the 'SANCTUARY' signs are still attached to the house! It's the first freaking picture in the listing!!

It drives me up freshly painted walls when realtors waste space pointing out the obvious. It's like mentioning, "Has roof."

Anyhow, I can clearly see that it used to be SANCTUARY, I just fail to see how that is more important information than, say, what flooring materials were used, what condition the house is in, and what, if any, upgrades are present.

Furthermore, how about letting us know what type of business SANCTUARY was. Clearly nobody is going to bother converting this place back to a residence--too much work. So don't you think it's a good idea to let your business-owning potential buyers know how it's set up? Perhaps these future entrepreneurs are interested in a floorplan more conducive to their particular mode of business? I mean, the set up for a restaurant or a book store is a lot different than a hair salon.

By the way, SANCTUARY used to be a hair salon. See? Helpful, right?

But I guess you "don't want to limit your potential buyers." Fair enough, but by listing this poorly placed plum pustulefor more than half a million clams, you've already done a bang up job of alienating most potential buyers. Not to mention the exterior paint color. I mean, is this Grimace's house?

This place looks like a bruise with windows.

Notably, if this Purple Equity Eater sold today, it would represent a loss of $350,000 in just 30 months. WOW! That is a catastrophic loss. The only way that's not going to hurt is if you were charging $4,300 for a cut and color.

And after 96 days, it's obvious that this asking price is still way off the mark.

I'm convinced sellers in this neighborhood are smoking some really good purple haze.

Speaking of weed, is there a better example of an invention created in a cloud of marijuana smoke than Goober?

"Man, it's such a hassle opening two jars to make a peanut butter and jelly sandwich. Plus, like, I gotta use two knives so I don't get jam in my peanut butter and vice varsity, man."

"Yeah, bro, totally. They should just, like, combine the two in one jar."

"Totally dude! We should like, totally, come out with that. We're gonna be rich!"

Thursday, December 17, 2009

2805 East 3RD St #14, 90814 WTF Price: $425,000 Beds: 2 Baths: 2 Sq. Ft.: 1,000 $/Sq. Ft.: $425 (The highest ppsft in this zip is $314) Year Built: 1974 MLS#: S596231 Source: SoCalMLS On Redfin: 30 days HOA Fine: $263Down Payment: $15,000 (FHA)Income Requirement (4x income): $106,000 (FHA would probably be more lenient here)Monthly Nut: $2,900 (FHA)Description: Fabulous opportunity! This Belmont Heights condo is completely re-done in the highest quality. This property is turn-key and immediate occupancy is available. Upgrades include: Spectacular walnut kitchen with cove ceiling with recessed lighting, tile flooring, stainless steel stove and dishwasher. Eating area. Crown mouldings and baseboards as well as new doors and casings throughout. Living room has an enclosed balcony, beautiful fireplace and is wired for a flat screen over the mantle. Both bathrooms highly upgraded including granite counter tops. The Master bedroom has new fan with lighting and balcony. A walk in closet and 2 additional closets--no storage issues here! This condo won the 2005 Belmont Beautification Award. This has to be the best value on the market today! Laundry Facilities are down the hall.

I was just going to post this property as a Shitty Realtor Photo of the Day, but I feel like the level of sheer delusion and stupidity warrants a further look.

First of all, shithead, thanks for the one photo of a condo that you claim won the highly prestigious "2005 Belmont Beautification Award" (whatever the holy fuck that is). Do you realize how unbelievably stupid that makes you look?

Not only that, but the photo you included has to be one of the most useless, out-of-focus, diarrhea-brained fuck ups I've ever seen. It looks like you took that shot with a Fothflex dipped in a vat of melted margarine while being tased in the corroded artery.

However, I was able to make out that big, gaping hole where the refrigerator should be. Newsflash, asshole: If I have to go out shopping for a new $1,000 fridge and sit around all Saturday waiting for two sweaty dudes to haul it up to my apartment--THIS PLACE AIN'T FUCKING "TURN-KEY."

And then there's the price. Good lord, man. $425,000?!

For the love of Peter Venkman the tax basis on this thing is only $273,000!

How did you even come up with that number? "How can I convince my therapist that I really am out of my mind"?

The monthly nut on this place, assuming a buyer gets an FHA loan (the FHA's new motto should be: "FHA...where the fuck else you gonna go?") is roughly $2,900. Dude, for a 1,000 square foot apartment that's missing appliances? I'd rather rent on the beach, stay nimble, and save a grand per month while doing it.

Interestingly, the listing information reveals that at one point the price was $390,000 (which is still a crack-smokin' number). Which begs the question, What bong-loaded economic green shoot prompted that $35,000 increase?

The comps certainly can't be what's fueling this greed-soaked idiocy. The only guy in the area asking for this kind of money is 188 Temple ($435,000) and he's too stupid to even include an interior photo.

Other than that moron, the next closest in price is the highly upgraded 315 Winnipeg ($395,000). And despite sporting an extra 200 square feet and a $30,000 discount, he's been rotting on the market since October with no love.

So what chance does our guy at 2805 3rd have?

But that dose of reality still won't deter him nor hundreds of other Long Beach sellers from enjoying their fool's paradise. To their dying breath they will defend their entitlement to massive bubble profits--market realities be damned. And some buyers have been bluffed into believing these prices have some footing in reality! Fools being fooled by fools fooling themselves. Like one continuous circle of Duh.

Sometimes I get the feeling that the return to normalcy and reasonably affordable housing for hardworking people is nothing but a fata morgana, one that gets further away the closer we seem to get.

"Will consider trade for a duplex with a yard." Hey fuckwit, for $875,000 I and every other potential buyer want a duplex with a yard too. THAT'S WHY YOUR SHIT HASN'T SOLD IN FIVE MONTHS.

What an idiot.

And speaking of idiocy..."Newewr"?

Really, douchebag? In a listing demanding nearly a million bones?

Or how about "Restored, enlarged Belmont Shore showplace home." Dude, we're talking about 1,600 square feet. How "enlarged" can it be?

[Speaking of enlargement, you want to know why those boner pill companies are allowed to exist despite being completely full of it (come on, think about it. If that shit worked, they wouldn't possibly be able to produce enough of it. Every single solitary dude on the planet would be ordering cases of the stuff. Bottles would be bursting out of glove boxes and briefcases across the globe. This would become a world of men walking around with tree trunks stuffed into their trousers. Hell, we'd all need motherfuckin' motorized scooters to get around)? Because they vaguely claim that they make you "bigger" and "firmer." But they specifically avoid saying bigger and firmer thanwhat. If we're talking about making you bigger than you were after a few laps in a cold pool, sure. Mission accomplished. But bigger than usual while "in the moment?" They craftily decline to say. And how do you know it wasn't rolling around with your partner that made you "bigger"? You don't. So although there is no way to prove the pill made you "bigger," (more importantly) there is no way to prove it didn't--and therefore the ads were not misleading. Plus, who would be crazy enough to file the first lawsuit bitching that the magic beans he ordered from the interwebs failed to make his (obviously) tiny junk into an unwieldly, Incredible Hulk-sized axe handle? Ta-daaaaa!]

Back to our regularly scheduled thrashing. This dude claims his joint is a "showplace."

Uh, okay. Whatever you say.

And just what does "Double garage behind available" mean? Does it cost extra or something?

With marketing acumen like this, it's no wonder buyers have been straight up ignoring your property since March. That's right. The house has been on the market since Q109 but after just 41 days the seller took their ball and went home when nobody would pay their Wishing Price.

In July the beggar--ERRRR...seller proudly proclaimed, it's "BACK ON THE MARKET!!!", naturally expecting people to give a shit. And it's been rotting ever since with zero buyer interest despite two $50,000 price cuts (both in October, 15 days apart).

Unfortunately, this delusual Long Beach seller lost his discounting momentum just when it seemed like he was starting to understand how this market works.

Sure, this thing in the Shore, but so what?

How are you going to compete with sellers like this property, on the beach side of 2nd Street? It sports two extra bedrooms, a bonus bathroom, 216 additional square feet and, other than some horrendous wallpaper that reminds me of the end result the last time I drank Jagermeister, is far superior in the looks department (and, well, every other department too).

Answer: You're not going to compete.

Not with your kitchen, anyway:

Woof.

Or how are you going to compete with this cozy nearby property? I have a feeling buyers would be far more willing to pay an extra five grand for an extra bedroom and 200 additional square feet. Just a hunch.

Oh, but this guy has something over all those other properties. As the listing description so thoughtfully and eloquently puts it: "Spa."

Yikes. All I want for Christmas is a staph infection.

Look, cash-flush people (yes, they still exist--despite what the doom and gloomers proclaim, plenty of people are still employed and have cash stockpiles from waiting on the sidelines for years) are going to continue to severely overpay for 90803 properties. That's just the reality of people with more money than brains (or patience). Case in point.

But unless the glory days of 8x income loans and credit cards for housecats return, I just don't see how 222 St. Joseph sells for $875,000.

Sunday, December 13, 2009

For those keeping score at home, this failed fliptard is now $5,000 below his 2008 purchase price. After commissions, we're talking about a $36,000 loss plus however many tens of thousands of dollars in upgrades and improvements.

Man, what the fuck were you thinking paying $625 per square foot last year? By that point you had been inundated by the media about the Great Housing Bust for at least six months!

This is going to end very, very badly for him. It's too bad he wasn't a reader of this blog back in '08. He could have saved himself a lot of money and heartache.

++++++++++++++++++++++++++++++++++

After reading some recent posts, a dear friend noted that I'm awfully negative and really bash the hell out of sellers. I tried to defend my position and explain that delusional sellers put themselves out there for ridicule and that harsh treatment by yours truly is not only well deserved, but necessary.

I mean, imagine if there weren't countervailing voices out there? Buyers (especially those in Long Beach, which is a seemingly forgotten real estate market--largely devoid of newspaper coverage) might get suckered into a financially perilous situation, as so many former "owners" did when they listened to biased, one-sided, commission-driven, largely unchallenged horseshit like "they're not making any more land," "we're definitely at the bottom" and "prices always go up."

I thought I had recently lightened up--especially since the early days of the blog--there was some real venom in those days--but from his outside perspective I was still oozing with negativity. So from now on I promise to be more positive.

So what was this guy thinking coming on the market at a belief-suspending $660 per square foot?

"I'm special," that's what.

Don't get me wrong, this is a nice house in a great neighborhood. It features every flipper accoutrement, including granite, (too much) tile work, stainless appliances, hardwood floors, and crown molding. I think it's a bit over-upgraded and looks too much like a paint-by-numbers flip job, but the fact remains you wouldn't need to put one thin dime into this place. And for that he deserves a premium.
But he's been rotting on the MLS for nearly three months with no price reductions--the calling card of someone with a case of Greedfluenza (Swine Fool?).

And speaking of pigs, you can slap on as much lipstick, mascara, and rouge as you want, but it's still only a 2-bed, 1-bath plus office crammed into 968 square feet. Do whatever you want to spruce up and upgrade a property, but the one thing you can't do is make it bigger.
And how about a picture of the front of the house? 16 photos and not one shot of the curbside view? Really?

This seller purchased in March 2008 for $605,000 (after the property had spent nearly a year on the market). After putting some work into the house (the listing from the 2008 sale shows the kitchen, patio, backyard, interior paint, and hardwood floors had already been upgraded), it went on the market this September for $639,000.

Some might say 17 months is a long timeline for a true "flip," but it's clear this person never really intended to live here long-term. Or at least could never afford to.

I have no idea how much this guy put into upgrades, but it's safe to say that after commissions he will be staring at a big, smoking crater in any bank account reserved for anticipated profits.

And that's assuming he can find a buyer for this crazy, please-someone-come-along-and-answer-my-prayers-for-breaking-even-on-my-horrendous-malinvestment asking price.

This thing is way overpriced. Or maybe I'm missing something about this property? What I do know is that the average price per square foot of sold properties in 90803 is about $470.
Is this place worth an extra $190 per square foot? Only the market knows for sure, but I'm going to say no.

What I find most interesting is this house sold for $515,000 in 2003, before all the upgrades. For '03 that's a lot of money for 968 non-upgraded square feet!

As you know I love these little bungalows. But some sellers are straight up smoking Plymouth Rocks if they think they can get these insane prices.

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